Episode 64: Starbucks’ On-Chain Loyalty Program is Kicking Butt… Why This Brand Strategy Works Ft: Adam Brotman
GUEST:
Adam Brotman, Forum3's co-founder and co-CEO, excels in enhancing brand-customer relationships and digital marketing through innovations such as loyalty schemes and mobile technology. His creativity earned him the #2 spot on Fast Company's "100 Most Creative People" in 2012 and the CDO Club named him CDO of the Year in 2015. Adam's rich professional background includes strategic leadership roles at J.Crew, where he initiated their first loyalty program, and notably at Starbucks. As their inaugural Chief Digital Officer, he orchestrated the development of Starbucks' mobile payment, ordering, and loyalty platform. Adam's current board commitments include MOD Pizza Company and Ruby Tuesday, and he has previously served on the boards of Neiman Marcus and Brooks Running Shoe Company.
“Think about Web3 as a technology or a capability set that can help enhance how you innovate your customer relationship transformation.”
THE EPISODE:
Adam Brotman helped envision and launch what's currently seen as the shining example of blockchain-based customer loyalty programs - the Starbucks Odyssey experience. Ashley chats with Adam to unpack what these programs can offer, and how blockchain technology and digital assets play pivotal roles in moving away from a short-term and transactional brand strategy, to a community-building approach which encourages storytelling, participation, and fun. He explains why on-chain loyalty programs are becoming easier to roll out, shares that most brands are afraid of experimentation (providing an opportunity to those willing to learn, pivot, and grow), and offers insights on how employees can drive innovation within their organizations. Adam also gives the audience a sneak peek into his current initiative, hive3.ai - where users can compete for great prizes from some of their favourite brands.
LINKS + RESOURCES
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LINKS + RESOURCES |
EPISODE LINKS & RESOURCES:
Starbucks Odyssey loyalty program - STARBUCKS
Nifty Gateway (Starbucks’ NFT marketplace) - learn more HERE
NBA Top Shot (mentioned by Adam) - click HERE
Flow Blockchain (mentioned by Adam) - click HERE
What is a Layer 2 Blockchain? (ex. “Polygon”) - info on ETHEREUM.org
From The Blockchain Ep. 40 on the Ethereum Merge and move to “Proof of Stake”
Nike’s .SWOOSH (mentioned by Adam) - learn more HERE
Learn more about Adam’s Hive3.ai - ARTICLE (GeekWire)
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*NOTE: The transcript below does not include opening teaser and intro in time stamps. Begins at beginning of the interview…
Ashley Smith (00:01.706)
I am so excited for today's episode. I have a very special guest with me today, someone that I've been hoping to speak with for some time, given the depth of his experience in the Web3 space, in the digital space, and also with his professional background. I'm talking about Adam Brotman, who is the co-CEO and co-founder of a company called Forum3. He also happens to be the former Chief Digital Officer at Starbucks who launched the Starbucks rewards mobile app along with and sorry who launched the Starbucks rewards mobile app and that's something that's being referred to a lot in the web3 arena and it's something that I know people want to know a little bit more about. That being said, Adam is working on some really cool things above and beyond all of this so I want to dive deep into his experience what he's seen happening, what he's seen work and what he is envisioning for the future. So first of all, Adam, Thank you so much for joining me today. Welcome to From the Blockchain.
Adam Brotman (01:03.858)
I'm good. Thanks for having me, Ashley. I'm happy to be here and talk about all those things you just mentioned. They're my favorite topics to talk about.
Ashley Smith (01:12.558)
Awesome. So why don't we, before we dive in, please provide our audience with a bit of a background in terms of who you are and some of the things you've done in your career up until now.
Adam Brotman (01:24.434)
Sure. So first of all, I'm born and raised in Seattle, Washington. So I'm a Pacific Northwest person. I come from a long line of retailers in my family. So I have that kind of going for me. It was lucky enough to be able to talk about business and retail and customer experience and brand building around the dinner table, so to speak, as a kid.
Went to law school, practiced law for a few years, and then started my own company. My first company was a company called Play Network that I founded way back in the late 90s, early 2000s. And it was a digital music company trying to essentially disrupt music using internet and hard drives and databases. And went from there to work for Bill Gates for a company he owned called Corbus in the digital.
imaging space and then ended up as Chief Digital Officer at Starbucks. I was there for 10 years, got to work on all these amazing things, including and most importantly, the Starbucks mobile app and loyalty program and mobile ordering program. I went from Starbucks after 10 years at Starbucks as Chief Digital Officer, went to New York, moved out of Seattle for my first time ever and
was the president and chief experience officer and eventually co-CEO of J.Crew, did a short stint there. And now I came back to work on a variety of things that were Starbucks related back in the Seattle area, connected with my best friend, Andy Sack, who is a successful entrepreneur and venture capitalist and digital transformation expert.
Ashley Smith (02:55.211)
Yes.
Adam Brotman (03:17.606)
We'd always, we'd been friends for 20 years. We'd always wanted to work together. And during the heart of the pandemic, we started to collaborate on some ideas around web three and brands. And that led to the formation of forum three, which is our full-time job now. And so I'm happy to tell you more about that, but that's kind of my background.
Ashley Smith (03:37.49)
Yeah, no, it's really neat. I think hearing about the varied experience that you have, and also one thing I'm hoping to dive into later on in this conversation is even just working closely with boards and senior leaders at companies and what they're thinking about when it comes to digital transformation. So we're going to dive into a bit of that too. So I'm saying that at the top of the show, so folks who are interested in that will listen through. So why don't we dive a bit
Ashley Smith (04:07.33)
I know you have some pillars that you speak about quite a bit when I'm looking at your website and whatnot related to co-ownership community, et cetera. So maybe you can share a little bit about that.
Adam Brotman (04:18.274)
Yeah, sure. So Form 3 is a, we're an interesting company because we have, we're building a platform that is centered on community gamification, storytelling and AI. You know, we very much, as we'll talk about, I'm sure, we're very much believers in the power and capability of Web 3, but we're, right now we're focused on a particular
Ashley Smith (04:36.113)
Mm-hmm.
Adam Brotman (04:48.074)
platform called Hive 3 that we're going to launch later this year that will essentially be a way for creators to citizen creators, I guess you could call them to compete for prizes against certain challenges that we're going to put out there. And we think it could be, you know, it's not an eSport, but we think it can be a very entertaining and informational way for people to learn about what's possible with AI.
And we have our own thesis around why, if we do this right with gamification and community, it can be this really cool business. And so we're planning that right now. We're getting ready to launch that. That's on the backs of the fact that Form 3 for the last couple of years has been an advisory services firm, I guess you could say. We've advised and partnered with a number of different brands and authors.
And most notably, we've had the honor of being able to be a partner of Starbucks and work with them on their Starbucks Odyssey loyalty game that they launched in December. And I can tell you more about that too, if you want.
Ashley Smith (06:00.734)
Mm-hmm. Maybe, yeah, why don't we unpack that just a little bit? Because I think a case study like that helps lay the groundwork and helps folks who, you know, where this type of strategy may be very new to them, may help them visualize the types of opportunities that can come with this technology. So why don't we unpack the rewards program a little bit?
Adam Brotman (06:27.05)
Sure. So let me go back to unpack it. Let me give you a little bit of background. So we launched, when I was at Starbucks, we launched the, what you think of today as the Starbucks Rewards Program and mobile app. We launched that in 2010, basically. And, you know, over the last, I left the company in 2018. By the time I left, we were up to, you know,
Ashley Smith (06:31.502)
Sure.
Adam Brotman (06:55.338)
tens of millions of active users, and almost half of the business of Starbucks US was on that app and through that loyalty program. Today it's, you know, well over 30 million active users, over 60% of their revenue comes through that program. So it's a very important, very prevalent program for Starbucks called Starbucks Rewards in the app, and you can use the app to redeem your rewards and track your rewards, which are called stars.
and then you can also order ahead and whatnot. And so one of the things that Starbucks was doing over this last 10 years is they would create these, I'll call it game-like experiences on top of the loyalty program. The loyalty program itself is sort of a spend to earn discount game, but it's like any loyalty program, but we're actually creating these additional pop-up games.
One of them was called Starbucks for Life, and still is called Starbucks for Life, where every December in the US anyways, you could, every time you used your app to buy a coffee or whatever at Starbucks, you would get a little shake of a snow globe, and then that would give you a sticker, and if you can complete a row of certain rows of stickers, you would win prizes like Starbucks for Life, or Starbucks for a month, or Starbucks for a week. And it would come up every December, and it would go away. And it was very popular, it is very popular. Starbucks did a really nice job of...
doing that game and it was like an additional way for you engaged with the brand. But you weren't having to go out of your way. You were still using the same app and the same loyalty login that you used to log into your app. So it wasn't very hard. It was very seamless. And you know, when I started to get into NFTs in 2021, my interest in NFTs and same with Andy, my partner Andy's and this is what Forum 3 was based on. We were, one of the very first things I thought about was
You know, it would be really interesting if Starbucks took their Starbucks for Life game and had to be always on. And instead of having it be about snow globes and little characters and whatever, what if it was about coffee education and Starbucks history and a bunch of immersive storytelling, community-based experiences that their core customers would want to have and what if you could reward them for engaging in that? And instead of getting a sticker, you got an NFT.
Ashley Smith (09:19.63)
Mm-hmm.
Adam Brotman (09:19.938)
And what if all of that laddered up to like unique prizes and whatnot? And it was just an idea I had. And I even wrote a note to the CEO at the time and said, I'm no longer there, but if I was there, I would be doing something like this. And when their CEO and founder, Howard Schultz came back for the third time. At the beginning of 2022, the spring of 2022 last year, he, um, and he's just like amazing, he's like,
Greatest, his name is Howard Schultz. He's one of the greatest business leaders of all time. He, he was curious about what Andy and I were working out this web three stuff. And he said, Hey, any ideas for Starbucks? And we started talking about it and he immediately was like, this could be really interesting. And, and then we, we got engaged to work with Starbucks formally. And the idea is what I just said. So Starbucks Odyssey is essentially what I just described. It's a game for loyalty members to play.
where they can essentially, they can sort of not compete with one another, but they basically compete to try and complete these journeys and activities that are all based on Starbucks brand storytelling. So it could be like take a virtual tour of a coffee farm in Costa Rica. It could be, you know, do an augmented reality scavenger hunt within your Starbucks store. Like, but it's all about learning about Starbucks history, learning about Starbucks coffee.
Ashley Smith (10:24.165)
Mm-hmm.
Adam Brotman (10:45.414)
learning about those elements of the brand that are really smart for Starbucks to be doing storytelling around. And then you get rewarded with these stamps, they're called. These are polygon based NFTs that you don't even have to know how to use a crypto wallet because Starbucks partnered with Nifty Gateway. So you just, they use a custodial wallet. It's just automatically associated with your account. You can move those stamps into your own.
Ashley Smith (10:58.582)
Mm-hmm.
Adam Brotman (11:12.522)
crypto wallet if you so choose, but you don't need to know or care anything about crypto to participate. And then every one of those little stamps contains points. And the whole purpose of the game is to try and get as many points as you can level up. And then four times a year Starbucks has these benefit selection periods where you get to be like, oh, if you're in level four, you get to get a custom Starbucks card with your stamp on it.
loaded with $100, or you can get coffee for 30 days, or you can get a custom tumbler with your stamp printed on it, or you can decide, no, I want to give it to charity, and you can essentially donate your prize to feed 50 people for a certain number of meals or whatever. So there's all this sort of giving back to the community, custom prizes, all based on a loyalty and Starbucks storytelling construct. And the web 3 part of it is that.
As you're doing this, you're collecting these stamps and they're digital collectibles. And there's a built-in marketplace into Odyssey. So if you wanna sell one of your stamps or buy one you don't have, you can, just like you would do with a baseball card or a pair of sneakers if you wanted to collect them. So there's a collectible element, there's a rewards element, and there's a storytelling element, all sitting on top of the loyalty.
Ashley Smith (12:10.855)
Mm-hmm.
Ashley Smith (12:29.338)
I appreciate that answer and actually I think it addresses a little bit. My next question is, this is the question I get from folks, is why do you need blockchain to enable this sort of activity? So maybe you can just help us understand that a little bit more.
Adam Brotman (12:43.794)
Yeah, it's.
Adam Brotman (12:47.806)
So it is the most interesting question because if you don't have something like blockchain, maybe there's something better than blockchain, I just don't know what it is. If you don't have something like blockchain that enables and facilitates the ownership of a digital asset, then it's really hard to do to basically incorporate something called the digital collectible.
Like you can do it without blockchain, I guess. I just don't know how. Like I don't, blockchain makes that really easy because blockchain is a great way for a place where everybody can look to and say, if there's artificial scarcity of digital assets or collectibles, how many are there? What are they and who owns them? So if you think about it, if you didn't have blockchain and you just tried to do it through web two, like a badge or like your own database, then,
Do you actually feel like you own this thing? That's, I mean, I don't know about you, but when I get an email from a company, it's a digital asset, I guess, and not really, it's not an asset, it's a digital piece of media. Do I own that email? Do I care about owning that email? Not really. But if all of a sudden, if the company said, well, I'm only gonna create 100 of this thing, and it's got, it's a collectible, and I'm gonna declare that it's a collectible, and I'm gonna declare there's only 100 of them.
Well, how do you do that with something that's natively digital? Do you think you can make infinite perfect copies of something? The way you, the way you could do it and the way that blockchain helps do it is. You tokenize it. You say, you say, okay, I'm going to declare how many there are that are authentically this collection. I'm going to declare it on an immutable blockchain and I'm going to make it open to everyone to see, and then if you want to like buy, sell or trade those.
whatever, like, you know, get them for free, doesn't matter, like, then all of a sudden my brain goes, oh, I now feel like I own this digital thing, like I can feel like I own a physical collectible, like a Starbucks mug or a pair of Nike sneakers. And so why you need blockchain in my opinion, is that it helps with the emotional feeling of ownership. And it's really hard to do that with a digital piece of media.
Adam Brotman (15:12.11)
if you don't have blockchain. And so that's why. So like, I, that, by the way, that's what got me into web three right away. It was like, I used to collect baseball cards and stamps and sneakers. And my daughter collects these little like Pokemon cards and little fuzzy things. And, and so like little fuzzy, like plushy animals and she collects. So if you think about collecting, like there has to be some kind of scarcity. If there's like unlimited supply of something.
it's who cares about collecting it, right? So the whole point of collecting is that there's like some level of scarcity and blockchain allows you to sort of dictate and articulate artificial scarcity of a digital item that can be so easily copied. So that's when I started to realize like that, I was like, I had fun collecting NFTs because I didn't care about price. I just like collecting. So I collected these, you know, alternative. I remember my first NFT was like an alt.
Ashley Smith (15:54.146)
Mm-hmm.
Adam Brotman (16:09.15)
Bored Ape, which was like the graffiti Bored Apes. And there was only 200 of them. And I thought they were really cool. And like, and every time they did a drop, I wanted to get one, not because I wanted to sell it, cause I just wanted to collect it. I thought it was cool. And I thought it was so neat that I could collect something digital, which I'd never had that emotional experience around. So that's why blockchain. Like without blockchain, people could argue that it's technically possible, but I think blockchain makes it easy because
Ashley Smith (16:28.451)
Mm-hmm.
Ashley Smith (16:35.511)
Yeah.
Adam Brotman (16:36.138)
You know what I mean? Like it just makes, it facilitates the easy like minting and ownership and transfer of ownership and understanding like how, you know, the artificial scarcity of a collection.
Ashley Smith (16:47.122)
Yeah, and I appreciate you saying that. I think that when we think about digital assets over the last couple of years, easy isn't necessarily the word many people would use to describe that process, especially if new to the Web3 ecosystem. You know, like for myself, I purchased my first NFT in 2021 and I had to buy cryptocurrency for the first time in order to do it, and that was a process. However, I think to your point,
Ashley Smith (17:17.906)
The layer two chains are really interesting. I think it's something that a lot of people out in the world that aren't paying attention don't really understand. I think a lot of people still associate blockchain directly with cryptocurrency and not necessarily as an enabling technology. We don't have to get super nerdy because I don't think our audience is there.
But can we touch on why and how maybe these layer twos are helping make it easier?
Adam Brotman (17:49.354)
Yeah, well, okay, I'll try. I'll try and take a complicated subject and make it as simple as I can. So when you want to own a digital asset like an NFT, regardless of layer one, layer two, doesn't matter. You need to hold it somewhere. Like you need something like you need someone. Now they call that a wallet. Now it's a weird name to call it. It's called a wallet.
Ashley Smith (17:56.749)
Yeah.
Adam Brotman (18:16.714)
using a wallet can be really hard, right? Like a wallet, regardless of whether you pay for an NFT or it's free or whatever, you need to hold it somewhere. So one of the things that I found to be really interesting is that one of the original NFT platforms that got really popular was, besides Nifty Gateway, which is also one of them, was a platform called Top Shot, which is the NBA.
has its own like video trading card NFTs. And you did not need to use, in fact you couldn't use a wallet at first. I think you can now, but like, not only did you not need something called a wallet, you just owned them and they just landed in your account and they held them for you. And what's called a custodial wallet, but it doesn't matter, they held them for you. And if you wanted to sell them, they would sell them for you. And it would all happen in the background. But because it was on blockchain, a lot of people...
loved playing collecting those cards because they felt the emotional feeling of ownership because they were being told oh there's only so many of them if you want to look on this flow blockchain you can see and so they made it really easy by handling all the stuff for you and that's what nifty gateway can do with what's called a custodial wallet that's what starbucks odyssey does. The interesting thing in that case those were technically like layer one on the flow blockchain
they didn't have, there weren't like costly transaction costs on the blockchain, which are called gas costs. But like there, there wasn't this like transaction fee that the blockchain operators were up charging you because, because it was a, you know, such a, you know, I'll call it contained blockchain. Ethereum has like that doesn't, that's not the case with Ethereum. Ethereum has transaction costs, which actually makes it secure and all that stuff. But so you could have like,
Ashley Smith (19:47.606)
Mm-hmm.
Adam Brotman (20:12.378)
You could be given an NFT, but you got to pay the transaction cost to mint it into your wallet. And that could easily cost like $5 or $10, and sometimes it could cost like $50. And so it became prohibitively expensive on top of the complication of having your own wallet. What layer 2s do, like Polygon or whatever, they essentially massively reduce the transaction cost and make it fast and f***ing expensive.
Ashley Smith (20:23.884)
Mm-hmm.
Adam Brotman (20:40.438)
almost free, almost like a penny or less than a penny. They don't, they don't though alleviate the need to have either a wallet or somebody have a wallet for you. So I would just say like, try not to be too complicated. Like what's, what's Starbucks, the reason Starbucks shows Polygon is because it was both inexpensive in terms of gas fees or transaction fees and fast. And at the time was more environmentally friendly.
Ashley Smith (20:51.12)
Right.
Adam Brotman (21:09.598)
Compared to eat layer one, which has now moved to this thing called proof of stake So it was like those are the reasons they picked it But you still needed to have a nifty gateway or somebody come along and help you be that Like hold your NFT for you if you didn't have your own wallet So that's my best attempt to kind of explain Like why layer twos are important, but also you have to deal with this wallet issue Which is like the complexity of like how do I hold my NFT if I don't want to deal with the complexity of a wallet? And how do I transact there?
Ashley Smith (21:24.816)
Mm-hmm.
Ashley Smith (21:37.623)
Mm-hmm.
Adam Brotman (21:39.262)
There are two different things and layer two solve part of it, but then you still have to deal with the wallet issue, which is by the way, getting a lot easier nowadays. Like there's these, there are these wallets that don't require you to have to like figure out cryptocurrencies and all sorts of crazy password and keys and all this crazy stuff. You can just, it's getting easier now. And with, and with the addition of these layer twos, you don't have to deal with these like wild transaction, gas fee things.
Ashley Smith (21:44.854)
Mm-hmm.
Ashley Smith (21:58.39)
Mm-hmm.
Ashley Smith (22:07.654)
Right? So I wonder then, given your experience over the last few years in particular, looking into the future, that's okay. I wonder, you know, what kinds of conversations are you having with folks who are looking at exploring this tech and how to include it in their strategies?
Adam Brotman (22:31.098)
Um, we're, it's interesting. We talk about this every day with brands. I think, um, you know, first of all, we're, we're pointing to case studies like Starbucks, Odyssey, or Nike. Nike has a great program called dot swoosh where people can, um, essentially collect digital sneakers, uh, which is really fun. Like, I mean, it really is. Cause there's like story, just like with Starbucks, they're incorporating storytelling and community and ownership. Um,
And just like Starbucks, you don't need to have to figure out how to use a crypto wallet or crypto currencies or anything like that in order to participate. So when we're talking to brands right now at Form 3 and they say, should we be doing something with Web 3? The answer is don't think of it that way. Don't don't. It's the wrong question to ask. The question is, how should you have a how should you be thinking about innovative ways to use digital to have a stronger relationship with your customer?
And in particular, we would say, and you mentioned this earlier, we would say today's customer is skews younger, of course, that's always true as you go through time, but like millennials and Gen Zs are very important part of your audience. We're in a post pandemic world where everybody's hyper digitized. And as a result, you need to emphasize emotional connections with your customers over.
being so transactional with your customers. So think about ways that you can incorporate the following four main things, community, ownership, or empowerment, or participation, storytelling, and gamification. If you think about those are the themes that we're saying, go find a way to use digital to incorporate those principles to have a tighter, better relationship with your customer, either because you want to do customer acquisition, or you want to do brand loyalty or frequency.
And then after you figure that out and started thinking about ideas there, then starts to think about how could you incorporate Web3? Don't think about Web3 as like your answer. Think about Web3 as a technology or a capability set that can help enhance the way that you're gonna innovate your customer relationship transformation. And so then they say, okay, great. Well, give me an example. And you say, well,
Adam Brotman (24:55.986)
I'll be honest, I just told you two examples, Starbucks and Nike are two examples of digital collectibles, like just a concept of introducing a digital collectible. And then you could add utility to that digital collectible, you can add gamification to that digital collectible. But the actual manufacturing of a digital collectible, like I just said, it costs you like a penny. If you wanted to create a physical collectible, it's gonna cost you more than a penny. It's gonna cost you, like you gotta manufacture it, you gotta ship it, you gotta store it.
You got to figure out how to add utility to it, which is way harder to do in a physical collectible than a digital collectible. And if you can pull that off of the digital collectible, you now have not only saved yourself money, but you've been able to maybe enhance, come up with some really cool, magical way to have a better relationship with your customer because that digital collectible, because it's digital, can do things that only digital media can do, like be an access pass and, you know, be a game piece and all these fun things that you can do to incorporate digital.
that you can't do as easily with physical collectibles or physical items. But I wouldn't start with the Web3 piece. I would end with the Web3 piece and start with like, that makes sense. Like you start, take Nike. Nike could have, Nike was so smart about like thinking about community and storytelling around their sneakers. So they were able to pull that off with these digital sneakers.
Ashley Smith (26:19.019)
They were able to fill that out.
Adam Brotman (26:23.638)
It's only adding top spin to that, that you can own them, and that you feel like you're collecting them, and it's yours. And so if you wanna use one of those things in a video game and wear those sneakers in Fortnite or something, I think that's what they're doing, and I think that's really cool. And those are my sneakers, and I can put them on my character. And that's something that I normally can only do with something that's physical. So they were smart, but they didn't start with, oh, I wonder how I can incorporate Web3. It was more of...
Ashley Smith (26:31.834)
Mm-hmm.
Adam Brotman (26:52.062)
How do I have community storytelling gamification using digital? And then they use Web3 to enhance it.
Ashley Smith (26:56.351)
Mm-hmm.
Ashley Smith (26:59.766)
It's funny this concept of community. I'm sure it's been around for a long time, especially as social media blossomed as it did. But I feel like I haven't heard that word in my entire life more than I have over the last couple of years. And maybe less so from a technology perspective and more so just from a brand and business development perspective.
Why do you think community matters so much and should it matter to most brands and companies? I guess the reason I'm not even pushing back but sometimes I think on a practical level, I'm like, okay, I like this brand. I'm a consumer of this product. But I'm not necessarily wanting to spend my time thinking about it much outside of my like use. And so I'm just wondering from that business side, what's the opportunity with community?
Adam Brotman (27:54.803)
Right.
Adam Brotman (27:59.042)
Yeah, it's funny you mentioned that because you're right. You could take something like, at first glance, there are certain products and brands that you're like, how are they even going to ever possibly do community like shell oil or tide detergent or something? But what's interesting about both those companies, when you start to look into what they're doing, they're desperately trying to...
come up with ways to tell their story. And so think about storytelling. And storytelling is this like natural human thing. And I'm a believer that any brand's fans are better at telling stories about that brand than the brand themselves. And people will be like, what are you talking about? You're like, yeah, well, they hire fancy agencies. They have smart creators and creatives and marketers that can tell stories. But you know, the best storyteller ever is like,
the customer that's passionate about a product. And so why is community so important and why are you hearing more and more about it now? I would say two things. One, first of all, it used to be easier to create community online until the, all of the algorithms took over from Facebook and Google and everybody else. And it was like, Instagram and everybody else. It was just hard to create community online because it was a pay to play, it became a pay to play exercise.
So you'd have to go, you'd have to do a lot of hard work to create community digitally. And in a world where it was easier to just like buy targeted ads, this is before the iOS privacy policies, rules kicked in, like, it was like, wow, what do I wanna do? Do I wanna spend a bunch of like energy and time and resources that are precious at a company to try to create community? Or do I wanna just go like buy top of the funnel, you know?
high performing digital ads and the answer usually was high performing digital ads. The other thing is that you the other so it was hard. Yep. It was hard. The other thing that. You're noticing is in web three the number one utility of many of these projects was community. So it was like and why so putting aside all the crap that came up in the space and still exist in space. There's a lot of like legit.
Adam Brotman (30:22.602)
projects that have legit communities and what makes them legit is actually like I don't know several hundred or several thousand people that all are having fun and they care about the same thing you know sometimes they might care about the number going up but the truth is like if you think about like I don't know if you've ever collected anything but think about like hobbies like art collecting art collecting baseball cards any hobby like
The people that are into that hobby, and particularly collectibles, they can't wait to talk to one another about it. It's like, they just, they wanna geek out on it. They wanna talk about it, right? And so, there's a natural proclivity to forming community when people have a shared passion about something. And I think that when you introduce ownership, and I told you earlier, it changes the experience, it changes the emotion, all of a sudden it's like,
you and your fellow owners wanna talk about things. I'll bet you that Tesla, I don't know this, but I think Tesla probably has a pretty thriving online community of owners. And it's different than, I think they're owners. I think that they don't necessarily think of themselves as collecting their Tesla, but they think of themselves as owning their Tesla and they're invested in their Tesla. So you think about terms of like ownership and investment and passion, they're gonna lead the community. And I...
Ashley Smith (31:29.762)
Mm-hmm.
Ashley Smith (31:38.853)
Mm-hmm.
Adam Brotman (31:47.946)
I just would say if I'm a brand, I always think you wanna create and harness energy from your super fans. And your super fans are gonna naturally wanna form community around one another. So it's not that it moves the needle on its own necessarily. It can, but if you can tap into the vibe, the storytelling, the energy of...
of a community of your super fans. And if you as a brand can stoke that and facilitate that and harness that, I think like it can change your whole business. I think it can give you ideas of how to tell your brand story. I think you can get product and consumer insights out of that. And you know, it's like the heartbeat of your company is in that could be in that community. So that's why I, as a marketer and a loyalty person,
Ashley Smith (32:43.878)
expert.
Adam Brotman (32:45.342)
I'm not really an expert, but like as a person that sort of thinks about that stuff all the time I'm like, oh, yeah, like I'm trying to foment community, right if I can
Ashley Smith (32:55.13)
Mm-hmm. So I know we're coming close for time. I do want to touch on this idea of folks within an organization. So take from this question wherever you find most interesting. So because you've been a senior executive, you've been serving board member, you've presented to boards and to senior leadership or senior execs.
Where should conversations around digital opportunities be happening? And like, if you're working within a company and you have some great ideas, how do you feel, maybe that's where I want to go, how do you drive innovation within an organization in a meaningful way, especially when the tech can be a bit challenging to understand, and perhaps has some bad press around it, and it doesn't have to be about blockchain?
But just generally speaking, any thoughts or tips on how to drive change or at least exploration of innovation. And then also, if there's anything in there about thinking about disruption of organizations.
Adam Brotman (34:04.026)
Yeah, yeah. So first of all, like my friend and business partner Andy Sack is so good at this topic. And he and I are actually going to write a book about the question you just asked, which is like, how do you as a marketer or as a business leader, think about digital transformation today? And if you think about like the convergent, the emerging technologies or emergent technologies,
Ashley Smith (34:19.679)
Awesome.
Adam Brotman (34:31.762)
To us right now, the three most obvious are AI, web three and metaverse. And I see metaverse broadly. I'm talking about like, you know, Apple's, you know, Vision Pro or whatever it's called. Like the, like, you know, mixed reality, blockchain, web three, generative AI. That's, those are like the triumvirate or whatever of emerging tech. And if you, and you have a consumer base that shifted, it's hyper digital.
and is skews Millennial Gen Z now more than it ever has. So all of a sudden you're confronted with like, I need to appeal to a younger generation of consumers that is absolutely comfortable with these emerging technologies and expects emotional and experiential connection to me as a brand, not just transactional. So what do I do if I'm a business leader? Well,
The first thing, and you're right, there's these counter narratives that these things are hard, they're tricky, they're scary. So what do you do? So the first thing you gotta do is you have to, like I said, you have to embrace the concept of experimentation. The number one thing that I'm finding when I talk to a lot of brands right now is that they are afraid to experiment. It's a kind of a classic like.
innovators dilemma or big company thing that they're just like, you know, it's not, it's not even, it's not even culturally in their organizational DNA to, to try to experiment because if you fail, um, you can, that could be career limiting for you. So what I'd say is if you, however, if you could try to talk to the board of directors or your, your CEO or your boss, um, about the fact that
Um, you know, leaning into these technologies, leaning into what these younger generations expect and, and being willing to experiment like that is critical because, and be willing to, you know, it's cliche to say, we want to fail fast and all that. I'm, I'm actually talking less about failing and talking more about learning and just, you know, um, having like a, a learning mindset. Um, and so you, so.
Ashley Smith (36:46.082)
Mm-hmm.
Adam Brotman (36:54.45)
That's what I would say, you know, and I will tell you that like the boards, CEOs of boards, that's what they want. And so there's this sort of feeling like, oh my God, I could stick my neck out. And if I'm wrong, if I fail, I could get fired or, you know, not progress in my career. But I think that's actually kind of counterintuitive. I actually think that, you know, either as an individual or as a team, if you can sort of embrace
the concept of speed of learning, embrace the concept of experimentation, understand that these emerging technologies are where you should be leaning in. And then, you know, go at it that way. That's, that's, that would be my advice.
Ashley Smith (37:38.87)
I appreciate it. I know that it probably could lend itself to a long conversation in and of itself. And when you write this book, I'll be happy to read it and probably share. So I know you got to go. I wish we could talk longer. That was wonderful. Thank you so much. If people want to find you learn more about you, Adam, or about Forum 3 or anything else you're working on, how would they go about doing that?
Adam Brotman (38:03.11)
Yeah, so we, so forum3.com is our website. Hive3.ai is our new Hive3 project we're working on. And I'm Adam Brotman, A-D-A-M-B-R-O-T-M-A-N at, you know, on Twitter. So, you know, if anybody wants to connect with me, just DM me and, or at message me and,
And I hope everybody kind of keeps an eye on Hive 3. That's going to be a fun new project.
Ashley Smith (38:36.85)
Yeah, I'm excited to hear more. I know you put a little teaser out on LinkedIn about it recently. So everyone, thank you so much for joining. Adam, I really appreciate your time. That went by really, really fast. I hope we get the chance to chat again into the future. But everyone, thank you. And we will be back next week.
